Do the Chinese Buy the Spin?
The administration likely offered something more concrete to the Chinese, during its groveling session, than we ordinary citizens apparently deserve:
Among the officials meeting with Chinese representatives Monday, the first day of two-day talks, were Treasury Secretary Timothy Geithner, Federal Reserve Chairman Ben Bernanke, National Economic Council Director Lawrence Summers and Peter Orszag, Obama’s budget director.
U.S. officials told reporters that the U.S. side stressed to the Chinese that the United States has a plan to bring the deficit down once the economic crisis has been resolved. Officials said Bernanke discussed the Fed’s exit strategy from the current period of extraordinary monetary easing.
If U.S. officials offered only the vague scams that have constituted their public statements, then we can expect the Chinese to accelerate their exit strategy from American investments. Although, it’s hard not to wonder whether it mightn’t be to the nation’s long-term good were the Chinese to turn off the spigot by which our government has tapped future generations.